A Zero B.S. Guide To American Healthcare

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Ah, the American healthcare system. Before Obamacare, half the country thought it sucked; half thought it was awesome. After Obamacare ... well, it's pretty much the same thing, now it's a question of which people are now on Team Suck vs. Team Awesome. The far right wants to cut the government out of healthcare altogether, while the far left wants nothing short of 100 percent taxpayer-funded healthcare. Meanwhile, a single Tylenol pill -- which costs 15 cents at Target -- can cost $15 at the hospital. For seven years, approval of the Affordable Care Act hovered in the low 40 percent range ... yet all of a sudden, on the brink of it actually being repealed, 54 percent of the public suddenly decided they like it.

A few years ago, if you asked me how the U.S. healthcare system should run, I would've said something like:

"Get rid of the confusing, overlapping mishmash of insurance companies -- Medicare, Medicaid, Private insurance, blah blah blah -- and replace it with a single program which covers everything for everyone. It'd be paid for by raising people's taxes, but everyone would still save money because those taxes would cost less than what they were paying beforehand due to there being no more price-gouging insurance companies and only one, much more efficient system to keep track of!"

Piece of cake, right? So why the hell is it so difficult to make major changes to the healthcare system in America? Well ...

Healthcare Terms Are Like Dungeons & Dragon Attributes

People throw terms like "Single Payer!" and "Universal Healthcare!" around a lot, often without understanding what the terms mean. I'm an old fart, so perhaps my D&D reference is going over everyone's head, but in that game every character had to roll the dice for different attributes like Strength, Wisdom, Dexterity, and Charisma (which I always thought meant how hot the character was, which might explain why I never got a date until I was out of college). In healthcare, the terms are a little different:

SP (Single Payer): How are the doctors & hospitals PAID? With Single Payer, they're paid directly by the government from taxes. Canada has a SP system

Not kidding about the cat plastic surgery thing.

But Wait There's More

Most people know that Medicare is Single Payer, and it is ... but it isn't Universal because not everyone has it. It isn't Comprehensive because it only covers about 80 percent of most types of medical problems. And while its Actuarial Value is fairly good, it still only covers about 84 percent of the cost of those medical treatments. On the other hand, it has an extremely high Network Size (just about every hospital and doctor accepts it).

Meanwhile, Medicaid is also Single Payer and is Comprehensive (but only in some states), with a high Actuarial Value ... but it has a crappy Network Size because some doctors simply won't take Medicaid patients because those doctors are evil doctors. Well, not really. Some have legitimate reasons, but still.

So roll your three six-sided die and pray for the best, because ...

We Don't Have One Healthcare System ... Or Even 50 ... We Have Thousands

Here's a pie chart which gives a rough breakdown of the healthcare coverage of all 320-odd million Americans:

-28M ~23M ACA UNINSURED Medicaid ACA (subsidized) Exchange ~8M OTHER ~9M Individual Large Group Mkt ~100M MEDICAID/CHIP (traditional) Gov't Small ~61M

I have a sudden urge to order pizza.

The exact numbers may be off a bit here and there, but it's a mishmash of Socialized Medicine (the VA), Single Payer (Medicare and Medicaid), and Private insurance, plus mixes of all three.

"Group" insurance means it's run through an employer; "Large Group" means a company with over 100 employees; "Small Group" is (wait for it) ... under 100. The Individual Market is for anyone who has to buy insurance for themselves because they're self-employed (like ... well, me, for instance), or because their employer doesn't provide it for them (like the X-Men, I assume).

So ... big companies have one system. Small companies have another. The military has their healthcare system for active duty (TriCare) and veterans (the VA). Many universities have their own plans for students. The Indian Health Service is for Native Americans. Medicaid is for the poor and lower-income folks. Medicare is basically Single Payer for old people ... but there's also several million people under 65 who qualify because they have certain types of disabilities or conditions.


Like exactly one X-Man, I assume.

Medicaid, meanwhile, is sliced up into different programs depending on whether you're an adult, a child, and so on. The Individual Market has the Obamacare exchange crowd (who mostly receive financial assistance) and "off-exchange" enrollees (who have to pay full price).

But Wait There's More

OK, so there's 18 different categories, plus a bunch of people who are still uninsured for one reason or another? Confusing, but not "thousands of categories" confusing, right? Well, here's the thing:

Each state has its own Medicaid program. Each state has its own rules and market for Large Group, Small Group, and Individual Market insurance. Medicare may be a single, federally run program ... but a whole lot of people in it are actually managed by Private insurance companies through "Medicare Advantage" instead of the government.

So you're really talking about several hundred programs or markets. Even in Public insurance programs like Medicaid, each state can have up to eight different eligibility categories depending on whether you're, say, a pregnant woman, a newborn baby, a toddler, a teenager, an adult, or a ghostly apparition whose only desire is to rob people of their sacred tax dollars.

Like Vizzini from The Princess Bride, wait 'til I get going! Because even within each state, there are "Rating Areas" for insurance companies to price health insurance premiums, which can be as small as a few zip codes or as large as the entire state, though most cover a few counties. There are over 3,100 counties in the United States. And there may be as few as one or as many as 20 different companies offering insurance policies in each one, so you do the math. No, seriously, stop and do the math right now.

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It'll be on the final.

Thousands of programs across dozens of states with different rules and regulations for each one means a whole lot of confusion and wasted money, energy, and effort ... right? Shouldn't we clean all of this mess up by standardizing everything with a single, nationwide healthcare program?

Absolutely! Unfortunately ...

People Don't Like Having Their Healthcare Messed With

Back in 2013, during the insanity of the first Open Enrollment period under Obamacare, several million people on the Individual Market had their healthcare policies cancelled as of the end of the year because the plans didn't comply with the new law -- that is, they didn't include some of the Essential Health Benefits which the ACA requires them to have. Like, say, prescription drugs, maternity care, or mental health services. Some of them didn't even cover stuff like hospitalization or surgery, which you'd think would be kind of important for a policy which is supposed to cover both health and care. For instance, Kff.org tells us that back in 2011 ...

"McDonald's 'McCrew Care' benefits ... requires employees to pay $56 per month for basic coverage that provides up to $2,000 in benefits in a year and $97 per month for a Mid 5 plan that provides up to $5,000 in benefits. Ruby Tuesday charges workers $18.43 per week (going down to $7 after six months of service) for coverage that provides up to $1,250 in outpatient care per year and $3,000 in inpatient hospital care. Denny's basic plan for hourly employees in 2010 provided no coverage for inpatient hospital care and capped coverage for doctor's office visits at $300 per year."

Wow! $2,000 in total coverage per year? That's ... um ... barely enough to cover a single ambulance ride to the hospital, if you're lucky. Once you got there, you were on your own.


"It's an extra $550 for us to wheel you inside ..."

OK, so some of those plans sucked, some of them were decent ... but either way, people freaked the fuck out when they found out their plans were being canceled. There was a massive backlash over it, made worse because President Obama had repeatedly stated that (all together now!), "If You Like Your Plan You Can Keep It!"

Now, in his defense, remember that he was saying this back in 2009. The ACA wasn't passed until 2010, and it gave the insurance companies another three years to bring their policies "up to code," or at least "up to not suck as much." Anyone who remained continuously enrolled in a policy which had started prior to March 2010 was allowed to keep their plan if they wished; the new requirements only applied to people enrolling in policies after that date. And after all, insurance companies change their plans for their own reasons all the time, as well as being bought out, going out of business, or deciding to no longer compete in certain markets. So I'm not sure Obama deserved all of the heat he took over that statement.

Even so, it was a pretty foolish blanket statement on his part, and he ended up having to issue a special 1-year "grandmother" extension (which was later bumped out to 3 years, then 4, and now 5 ...) for people who signed up for non-compliant plans between 2010-2013. Even with that, lots of people were still pissed off about the whole brouhaha. Yeah, I said, "Brouhaha." I'm not sorry.

But Wait There's More

Remember: That was only five to six million people having their policies messed with.

Now imagine a couple hundred million people having their policies shut down and replaced with a new one all at once. Imagine the anger, the chaos, the confusion ... even if the new system turns out to be better, more efficient, less expensive, and less confusing across the board.


Close enough.

Here's where it gets messy. According to a 2016 Deloitte study, 54 percent of people insured through their employer and 53 percent of those on ACA exchange plans are satisfied with their plans. Meanwhile, 74 percent of those on Medicare are happy with it and 71 percent on Medicaid are as well.

Add it all up and around 58 percent of us are satisfied with our current coverage. Of course, that also means 42 percent of us aren't (including 29 million who still don't have any coverage at all). But the point is that those 58 percent are spread out across all of the major types of coverage. If 100 percent of Medicare enrollees were happy and 0 percent of everyone else was, the solution would be simple ... but that's not how it works.

When half the people like the way things are, it's incredibly difficult to get them to change, even if the other half are getting screwed. Heck, last November the residents of Colorado had the opportunity to pass a Single Payer healthcare bill at the state level. If it had passed, about a quarter of the population would've stayed put, but everyone else would've been covered with a new Single Payer system, paid for partly with Obamacare funding and partly by adding new payroll and income taxes. Remember, these taxes would be replacing just about all of the payments that Colorado residents are currently paying for their health insurance.

Bernie Sanders campaigned for the Colorado plan. So did Michael Moore, Noam Chomsky, and other progressive big shots. Colorado is a purple-to-blueish state. You would think that it would've either passed or, at worst, come kinda close. Instead, the proposal was spin-kicked right in the suckhole.

THE DENVER POST POLITICS ELECTION Coloradocare measure Amendment 69 defeated soundly Coloradocare's $36 billion budget would dwarf state government's
The Denver Post

A completely unsatisfying end to 69.

Now, you can argue that opposition from a couple of Colorado's highest profile Democratic officials didn't help matters ... but it still lost 80 to 20 in a state where Hillary Clinton won by five points. On paper, it should've gotten a hell of a lot more than 20 percent of the vote ... but in practice, it was simply too big a shock to the system all at once for people to swallow, even if the numbers added up.

Bottom line: People take their healthcare coverage very, very personally. The Democrats found that out the hard way in 2010, and it looks like the Republicans are learning the same lesson today (especially since their replacement plan for Obamacare has been found to be far, far worse for about everyone except the super rich).

OK, by now you're thinking that I'm opposed to Single Payer ... and you'd be dead wrong. I support a Single Payer-like system ... eventually. The tricky part is getting from here to there. There's a bunch of other problems nobody ever considers, like ...

What To Do With The People Who Work For The Insurance Industry?

No, I'm not talking about the Fat Cat CEOs who receive tens of millions of dollars in stock options and golden parachutes. Fuck them. I'm talking about the everyday schmoes ... the claims processors, the actuaries, and so on. Well over half a million people work directly for health insurance companies, plus a couple million people in directly related industries like insurance brokers, agents, and the like.

These numbers might not sound huge, but consider that employment in the mining industry (and that's all types of mining, not only coal) has never been higher than 1.2 million people nationally in the past 60 years, but everyone still wrings their hands and frets over what to do about dying coal towns in Kentucky and West Virginia. And that's an industry which has been slowly, gradually dying off over a period of several decades (starting long before President Obama came in and force-fed LED light bulbs and solar panels to every gun owner in America).

A Zero B.S. Guide To American Healthcare

"Either you eat it, or twist it up the other hole."

On the one hand, it's true that unlike coal mining, most people who work for the insurance industry could probably transfer their skills to other jobs ... but you're still taking away their current job. Even if you include funding for "retraining" into account, you're still telling these people, flat out, that what they do has become obsolete.

But Wait There's More

Perhaps the government would hire them to help manage the brand-new Single Payer system? Well, not all of them ... after all, one of the major advantages of Single Payer is that it's a lot more efficient than the current system. That means economy of scale, less duplication of effort ... otherwise known as firing the shit out of a ton of people who are no longer needed.

Let's say half of them end up working for the government. That still leaves the other half. Even if every single employee were somehow guaranteed a new job, what about having to uproot their lives, perhaps having to move to a different state and so on?

Now, I know what you're saying, "Cry me a river! Different industries are changing and becoming obsolete all the time! You don't see anyone shoring up the abacus or slide rule industry these days, do you?"

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"There's a reason you used a calculator in that math joke earlier!"

True, and I'm not saying making such a sweeping change shouldn't be done ... I'm simply pointing out some of the reasons why it's extremely difficult to do so. This isn't a game of Risk, where you can shuffle your armies around from one place to another like that *insert finger-snapping sound*. These are real people's lives.

Think of it this way: What do you do for a living (or hope to do some day)? Whatever it is, suppose that you were told that the entire field is being eliminated ... on purpose? Even if the reasons for it were sound and society would be better off as a whole because of the change, how many of you would respond by saying, "Oh, well if you put it that way, I guess I'll have to rip up my resume!"

Remember, changing healthcare policy isn't only about what looks logical on paper, it's about persuading people (either voters, politicians, or both) to agree with you. The emotional aspect is a tough nut to crack, especially when it changes from the hypothetical to the here and now.

Speaking of hot-button, high-emotion issues ...

Wait Until The Religious Battles Begin To Rage

You may have heard of a nasty little piece of federal legislation from 1976 called the Hyde Amendment. The short version is that the Hyde Amendment makes it illegal for any federal funding to be used to pay for abortion, except for cases of rape/incest/life of the mother. Medicare is paid for with federal dollars, so no abortions for grandma! Of course, that's not generally a problem for women over 65 anyway (although it turns out there have been a couple of cases of women in their sixties managing to pull off giving birth).

What about Medicaid, the other major government-funded healthcare program? Well, Medicaid is mostly funded by federal dollars ... but about a third of it is paid for with state funds. Some states pay for abortions for Medicaid enrollees, some don't. Lo and behold, it's roughly 50 percent, like so many other things in this big, dumb country of ours.

Figure 1 Distribution of Women on Medicaid, Ages 15-49, by Abortion Coverage Residing Residing in States in States Restricting Providing Abortion Abor
Kaiser Family Foundation

Oh, look! The nation is split on abortion! Who could've predicted that?

So what's this have to do with switching to a Universal, Single Payer system? Well, think it through. If done at the federal level, this would effectively mean that every abortion would have to be paid for 100 percent out of pocket. Hell, this was even one of the major problems the Colorado SP proposal ran into. The National Association for the Repeal of Abortion Laws, which you would think would support going SP, strongly OPPOSED the initiative for exactly this reason ... because it turns out Colorado is one of the states with its own version of the Hyde Amendment.

But Wait There's More

Abortion is the most obvious medical/healthcare issue which raises religious/moral hackles, but it's hardly the only one. Remember the Hobby Lobby Supreme Court case a few years back? One of the provisions of the Affordable Care Act was to require all compliant healthcare plans to include contraception coverage, including employer-based coverage. The only exceptions were supposed to be for religious organizations and certain non-profits who objected. Well, Hobby Lobby, a very much FOR-profit corporation who sold contraceptives themselves right up until they were required to do so, decided to take the government to court over it.

OK, let's get out of the pregnancy zone. How about HIV prevention? Should a needle exchange program be included in a federally funded healthcare system? What about living wills and end-of-life counseling (the infamous so-called "death panels" which were roundly debunked and made PolitiFact's "Lie Of The Year" for 2009)? And remember, earlier I mentioned that true Universal Coverage would have to include millions of undocumented immigrants. I'm sure no one in the halls of Congress would have a problem with that. Not at all.

Some of these issues have been decided, some haven't. The point is that ALL OF IT has to be taken into consideration politically, emotionally, and economically. Making any substantial changes to the system will mean lots of lawsuits, and protests, and pissed-off people no matter how it plays out.

Speaking of economics ...

Shocker: Most People Aren't Happy About Being Paid Less

One of the major reasons Medicare works so well cost-wise is that it only pays doctors/hospitals 80 percent of the Private insurance rate on average:

"The downside to Medicare paying $426 on average for a colonoscopy when Private plans offer $639 is that as a result, some doctors refuse to see Medicare patients. This is particularly something you see in large, dense, rich cities like New York or Boston where medical practices that can manage to get themselves written up on magazine 'Best Doctors' lists can afford to be choosy about their patients."

"But to the average health care provider, the Medicare patient market is too big to ditch. Doctors -- and hospitals and everyone else -- take what they get and are glad for it."

If you tell anyone that you're about to cut their income by 20 percent, they're gonna be cranky about it. Now, you may think that doctors are overpaid as it is, and many of them are, but they're not likely to see it that way any more than the insurance broker who's being kicked to the curb. Again, this isn't about what should be changed, it's about why it's so difficult to change things. I mean, I think the moon should be destroyed because it's stupid and evil, but it's not going to be easy.

A Zero B.S. Guide To American Healthcare
Gregory H. Revera/Wiki Commons

Trust me, I've been trying for decades.

The reimbursement situation is even more dramatic when it comes to Medicaid, which only pays doctors/hospitals around 60 percent of what Medicare pays them. The amount varies from state to state, but by my math, 60 percent of 80 percent = Medicaid paying doctors around half as much as Private insurance policies do.

"AWESOME!" You might say. "Stick it to those greedy hospitals/doctors! They don't need any more marble foyers and Ferraris!" Again, that's a perfectly valid take ... bear in mind that the doctors aren't gonna see it that way, which is why some doctors sidestep the problem by simply refusing to see Medicaid patients at all.

But Wait There's More

If you don't want to cut how much doctors get paid, there's an obvious solution: Increase the reimbursement rate! I agree. Medicaid, at least, should be beefed up. Remember that even increasing Medicaid reimbursements to the same level as Medicare (which, again, is still 20 percent lower than Private insurance) would mean increasing the Medicaid budget from around $550 billion per year to $730 billion. That's an extra $180 billion per year to enhance how much healthcare providers get paid for treating the current Medicaid enrollees.

In short, as in every other industry, there's no magic solution here. Healthcare as a whole eats up around 18 percent of our Gross Domestic Product, so any significant change you make impacts nearly a fifth of the entire U.S. economy. Our healthcare system is like a large ocean liner -- it can't be turned on a dime no matter how much better the new direction is.

That doesn't mean that you can't make major changes to it ... it means that it has to be done gradually. Think about the massive controversy and disruption caused by Obamacare itself. It mainly impacted about 30 million people ... that's less than 10 percent of the population. To even get that far, it still took nearly two years of debate before it passed and another five years to fully ramp up.

A better analogy is one of those old-fashioned tile puzzles, the kind where there's one piece missing, so to unscramble the picture you have to move one piece at a time, which means having to move the rest of them one by one as well. Changing one part of the system causes a ripple effect across a bunch of others, so you have to give it time to absorb the shock before making your next move.

Marvel Entertainment

Thankfully, Obamacare already covers both thyroid problems and gangrene.

The U.S. healthcare system can be overhauled and streamlined so that we can have Universal, Comprehensive, Quality, Affordable healthcare ... eventually. It's gonna take time and work to get us there, and it'll have to be done in chunks, that's all. And preferably not by complete idiots.

Charles has been fooling people into thinking he knows a lot about healthcare since 2013. Call him out for being a fraud on Twitter.

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For more check out 5 Terrifying Things Nobody Tells You About Health Care and 5 Huge Problems Nobody Told You About American Healthcare.

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